Is Your Supply Chain Ready For A Review?

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“Don’t go changing to try and please me” was famously sung by Billy Joel in his 1977 song. Being in transportation sales we hear similar quips quite often:

“We are all set.”

“We don’t want to change”

“We have had a long standing relationship with our 3PL or carrier for a long time”

The role of a good sales team is to open the eyes of their prospect and show them better options that are out there. On the other hand, pursuing a prospect should only be done if the sale will be mutually beneficial; the dreaded one sided sell will never be a true partnership.

Here are five key questions that manufacturers, distributors, and large enterprise clients should review internally to see if they are ready to make a move.

1. Is your transportation spend over 1 million a year and are you in good standing financially?

Businesses that have transportation spends of over 1 million per year are typically ready for change. Saving a small percentage on the hard costs while improving manual processes can dynamically change a transportation department. The carriers will look into your credit and payment history, just like a credit card company or lending agency would. Always make sure you’re within terms with vendors.

“When tenured employees retire, their replacement is always in a position to prove themselves.”

2. Is there an agent for change within your organization? Are you losing market position to competitors?

When tenured employees retire, their replacement is always in a position to prove themselves. For example, if your organization hires a new CFO, within the first year they’ll want to improve cash flow while reducing inefficiencies on the general ledger. The transportation department is one of the easiest places for the new CFO to start, especially when the process has not changed in a while. If you’re losing market position and shelf space in big box retailers such as Wal-Mart, it’s time to take a deep dive into charge back management and shipment life cycle.

3. Is there an issue with the status quo?

If your current transportation provider has gotten comfortable then your business will become unhappy with the status quo. Are you conducting quarterly business reviews that propose improvements moving forward into the next quarter? If this is not happening in your transportation department now, then it might be time to start looking. Is anyone unhappy with the current 3PL? If there is a problem does that 3PL just patch or plug the problem instead of truly fixing it? Start asking questions and you may find that your supply chain is not actually “all set.”

4. Is your company open to new ideas?

Do you and your staff go to trade conferences? Do you use social media? Is there an employee happiness tool in place such as Tiny Pulse? Are your employees reporting weekly progress on S.M.A.R.T or quarterly goals on a tool like 15/5? Are your leaders engaging with businesses in your vertical and discussing best practices? These communication tools can be essential to growth in your organization, the key is to always be flexible and adaptable to change.

“Ask your employees “What did you learn this week that you didn’t know last week?”

5. What are the overall goals of your transportation and supply chain departments?

Metrics, metrics, metrics. These are so important for customers that have a significant freight spend, whether it be cost per pound, freight cost as a % of sales, accrual to freight cost, Wal-Mart and other DC charge back management programs, etc. Internal KPI reporting is critical to providing beneficial metrics to enterprise level customers. Organizations need individuals that can be constructively challenged and sharing knowledge with industry and LinkedIn groups discussing best practices. Ask your team for feedback on specific topics in your vertical market. Questions like “What did you learn this week that you didn’t know last week?” can be a key factor in keeping your employees engaged.

We hope you found these tips helpful going into 2016 and every week, month, quarter after.

If you feel that maybe your transportation and supply chain are no “all set”, feel free to call us at 800.MY.SHIPPING to discuss your options with an experienced BlueGrace Enterprise member today. We are happy to help discuss all of your options.

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